Improving market access, network reach and streamlining delivery are some of the key drivers for rural and agricultural prosperity. Railroads enable the efficient movement of goods across the country and around the world, and serve as important connections between rural farms and urban centers.
According to the Federal Railroad Administration, the U.S. freight rail network operates approximately 140,000 route miles and is widely considered to be the largest, safest, and most cost-effective freight system in the world.
In December, Canadian National Railway (CN) signed an agreement to acquire approximately 218 track miles of the Iowa Northern Railway (INR), connecting to the CN US rail network. This means agricultural products will be shipped directly to major markets in the Midwest, such as Chicago, and buyers will have access to more agricultural processing centers, such as feed mills and soybean plants.
These positive changes will support the growth of local businesses by enabling access and opportunities to new and more geographically diverse markets. Ultimately, this post-sales market will be strengthened by competition, allowing producers to continue choosing the best option for their business.
According to the magazine, producers across the country continue to cite “increasing input costs” as their top concern for next year. Agricultural economic barometer. This transaction is expected to alleviate some of these costs and we can breathe a sigh of relief. Direct service between suppliers speeds time to market, lowers inventory carrying costs, minimizes delays caused by switching between carriers, and reduces potential factory shortages.
The chain reaction results in better pricing across the network of suppliers and buyers of goods. Due to the interconnected nature of agriculture, we feel these efficiencies are leveling the pendulum of costs and profits, impacting our overall bottom line.
Finally, as we make a living and raise our families in the countryside, we value our community above all else. One of the most important factors in any business transaction in our town, county, or state is what it benefits. CN made it clear that IANR is, as always, committed to the local communities in Iowa where IANR operates. They are committed to building regional partners, from local fire departments to the United Way, and retaining and enabling further career growth for existing employees, with more than $300 million spent on Iowa’s rail network alone. I invested. Actions speak louder than words, and these gestures demonstrate the values ​​most important to rural America.
The final hurdle for the deal is a review by the U.S. Surface Transportation Board (STB), which is expected to be completed in 2024 and is considered a “minor transaction.” Let’s hope for a quick process to help agriculture and rural communities cross the finish line and win this victory.
Mr. Scorpa is President of Beartooth Fertilizer Company in Fox, Montana. Chris provides fertilizer, custom application, seeding, soil testing, and crop consulting to farmers and ranchers in southern Montana. Beartooth is a family owned and operated company. Chris serves as Vice President of RACA and is a past director of the American Cattlemen’s Association.
